You cannot hold any physical precious metal in a regular individual retirement account (IRA). However, there are specially developed precious metal IRAs that allow you to invest in retirement with gold, palladium, silver, and other valuable metals. A Gold IRA is a specialized, self-managed individual retirement account that is designed for precious metals. As with a traditional IRA, a gold IRA allows pre-tax contributions, and investment income can then accrue deferred for tax purposes.
The contribution and income limits are the same. Unlike a traditional IRA, which normally holds paper assets such as stocks, bonds, funds, ETFs, and cash equivalents, a gold IRA is set up exclusively to hold physical gold or other approved metals. You do not hold the gold yourself, but must store it in a secure deposit. Gold IRAs are specialized individual retirement accounts that hold precious metals such as gold, silver, platinum or palladium.
Like traditional IRAs, these accounts typically allow pre-tax contributions and have similar income and contribution limits. For example, you could have one IRA that is invested in precious metal bars and another IRA that is invested in liquid assets such as listed stocks and mutual funds. You can fund your account by transferring money from an open IRA or by transferring a 401 (k) to a new, self-directed IRA. A precious metal IRA is simply a traditional IRA, ROTH, SEP, SIMPLE, rollover or inherited IRA that owns precious metals and can include gold, silver, platinum or palladium.
If you properly transfer your money from an IRA or retirement account to a Gold IRA, there is no tax impact. When you buy the gold for your IRA, you must also buy it in gold coins worth one, a half, a quarter, or a tenth of an ounce. Augusta Precious Metals is a leading gold IRA company founded by Joe Montana, a Hall of Fame quarterback, and his team of financial advisors. Once you’ve set up your Gold IRA, you can transfer or extend funds from an existing IRA or other retirement plans.
If you’re looking to open a gold IRA or other precious metal IRAs, it’s important to hire a reputable, trustworthy company to make the process easier. As a result, the transaction is marked as a taxable distribution from the IRA, followed by a purchase of the metal or coin by the IRA owner (you). Instead, these companies require you to either transfer money from an existing IRA or withdraw money from an existing account and deposit it with a new IRA. The two major drawbacks of Augusta are the limited selection of metals and the high minimum investment requirement for setting up a gold IRA.
With many scams and misleading ads, it’s important that you do your research before opening a Gold IRA account. When you open a Gold IRA account, you must store your investment with a custodian such as a bank.
